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Human Rights
Human rights are fundamental principles allowing individuals the freedom to lead a dignified life, free from fear or want, and free to express independent beliefs. Since the end of the Second World War, the debate around human rights has been increasingly codified within an international human rights legal framework. This framework provides the basis for much of the dialogue around corporate responsibility for the protection and promotion of human rights.
The 1948 Universal Declaration of Human Rights (UDHR) is the most widely accepted codification of universal human rights in existence. The UDHR encompasses inter alia the right to life, the right to recognition before the law, freedom of thought, conscience and religion, freedom from torture, freedom from slavery and freedom from imprisonment for debt or from retroactive penal legislation.
The preamble to the UDHR calls on ‘every individual and every organ of society’ to respect and promote the rights set out in the UDHR. While companies are not the explicit subjects of international human rights law, it is widely argued that companies also have a duty to respect and promote human rights. Rights issues that relate to business include health and safety at work, freedom of association, equality of opportunity, freedom from discrimination, freedom from slavery (including forced or bonded labour) and the right to privacy. There have been a number of high profile examples of companies being accused of violating these rights.
However, the specific scope of companies’ human rights obligations remain the subject of debate. In April 2005, the UN Commission on Human Rights adopted a resolution requesting the UN Secretary-General to appoint a Special Representative on the issue of business and human rights to: identify and clarify standards of corporate responsibility and accountability for business with regard to human rights, to research and clarify the implications for business of concepts such as “complicity” and “sphere of influence”, and to develop materials and methodologies for assessing the human rights impacts of businesses. In July 2005, Kofi Annan appointed Professor John G. Ruggie to be Special Representative of the UN Secretary-General on business and human rights. For information on the work of the Special Representative click here.
The principal objective of our work on human rights has been to encourage the companies in which we invest to address effectively any human rights risks associated with their activities and operations. This work is divided into three areas:
A number of our other engagement programmes also have human rights dimensions, including:
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Human rights policies and management systems
We encourage those companies with the greatest exposures to human rights risks (e.g. companies in sectors such as oil, gas, mining and defence, companies with significant exposures to countries where human rights are an issue) to:
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Adopt policies that commit them to protecting and promoting human rights
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Express support for the UDHR and the core conventions of the International Labour Organisation
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Implement systems and processes to ensure that these policy commitments are met.
In 2003, we surveyed the FTSE100 to canvass their views on international standards such as the Universal Declaration of Human Rights, the Core Conventions of the International Labour Organisation and the OECD Guidelines for Multinational Enterprises. We subsequently wrote to 74 companies to raise their awareness of the draft UN Norms on the Responsibilities of Transnational Corporations and Human Rights which provided a broad framework for business’ responsibility for the protection and promotion of human rights. Since then we have actively encouraged selected companies to conduct a self-assessment (or gap assessment) of their current human rights management systems, processes and performance against the Norms, as a starting point for identifying potential weaknesses in this area. For example, in 2006 we wrote to a number of UK banks encouraging them to conduct such a self-assessment, to adopt consistent group-wide human rights policies and to engage with human rights organisations. We have previously made similar requests of other companies, including BAE Systems, Standard Chartered and BHP Billiton. Companies have indicated that this process helped them to identify potential areas of weakness in their management systems and processes.
Controversial projects and issues
The second element of our work relates to project- or activity-specific human rights concerns, whether because of the specific country (or countries) in question or because the press or a non-governmental organisation (NGO) has raised a human rights issue. These may be one-off discussions – for example, we discussed BHP Billiton’s disposal of its Tintaya mine in Peru with the company – or more significant engagement programmes.
One of our major engagement programmes in 2003 and 2004 related to the controversial BTC (Baku-Tbilisi-Ceyhan) pipeline project to export crude oil from Azerbaijani fields under the Caspian Sea through Georgia to a new export terminal at Ceyhan on the Turkish Mediterranean coast. BP is the largest stakeholder in the pipeline and was also the project manager for the pipeline construction. The BTC pipeline project has been the subject of an extensive and long-running NGO campaign with particular areas of concern being the host government agreements (HGAs) between the BTC Company and the governments of Azerbaijan, Georgia and Turkey which were believed to be undermining human rights protections in many ways. By, for example, placing direct financial disincentives on state action to uphold national or international human rights law, the political instability of the region, bribery and corruption, the risk of conflict, the potential for human rights violations along the pipeline – in particular as a result of the activities of pipeline security forces, the absence of adequate human rights or conflict risk impact assessment studies, and environmental risks. Insight hosted a meeting to enable investment institutions to gain a better understanding of the extent and significance of NGO concerns about the project. We subsequently organised a meeting between institutional investors and BP to discuss the steps it has taken to address the NGOs’ concerns. Following these meetings, we maintained a dialogue with BP about the project, encouraging the company to respond to NGO concerns about the project host government agreement (which BP addressed through a separate new legal instrument called the “BTC Human Rights Undertaking”, in which BTC undertook not to seek financial compensation in the event that the Turkish, Georgian or Azerbaijani governments acted to fulfil their obligations under any international treaty relating to human rights, the environment or health and safety) and encouraging the company to extend the duration of the Caspian Development Advisory Panel (CDAP), a body established by BTC to provide external oversight of the project.
Similar human rights engagement activities have included:
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Ongoing dialogue with Shell about its human rights performance in Nigeria and Russia (Sakhalin) and the processes the company has in place to ensure effective oversight of the social and environmental impacts of its projects. In 2006, Shell strengthened the role of its Board Social Responsibility Committee and has, in response to our request, committed to providing greater disclosure on the work of this Committee in its annual report and accounts.
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In 2003, we held discussions with British American Tobacco and Standard Chartered about their operations in Burma, and the reputational and other risks to their businesses. Both companies subsequently decided to withdraw from Burma, in part influenced by the concerns expressed by investors.
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Encouraging BP to extend the duration of the project oversight panels for its BTC project (see above) and its Tannguh LNG project in West Papua.
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Contributing to the wider business and human rights debate
The third strand of our work is to contribute to broader discussions around corporate responsibility and human rights. Rory Sullivan (Head of Investor Responsibility) has edited two books Business and Human Rights: Dilemmas and Solutions (2003) and Putting Partnerships to Work (with Michael Warner, 2004) which analyse the practical experiences of companies in responding to specific human rights issues in their operations, in their supply chains and in specific countries. Rory also sits on Amnesty International’s UK Business Group and he was also a member of the Steering Committee for the development of the International Alert report “Conflict-Sensitive Business Practice: Guidance for Extractive Industries”.
Briefings
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